Opinion & Analysis
Rory wipes iPhones, creates more legal questions
Rory’s plan to return to golf at the Master’s with a clear mind is very unlikely.
His legal battle against his former management company Horizon Sports Management is going to take a while with yet another setback in the discovery process. According to an IrishTimes report, Horizon’s attorneys are alleging that Rory McIlroy and his father Gerry violated a court order when they intentionally wiped the memory of a reported eight or more cell phones and electronic devices that may have contained relevant information concerning the case. Believing that they can still access the information, Horizon’s legal team is seeking the court’s permission to “forensically inspect” the phones used by both Rory and his father going back three years.
This case is reportedly scheduled to begin in January, since months of pre-trial negotiations have failed. If it does go to court, a resolution by April before the Masters allowing Rory to sleep easy while he attempts to complete the Grand Slam is just not going to happen. The amount of money at stake is enormous and regardless of what decision is initially made, it will be argued to death in appeals court. Any trial lawyer can tell you that the appeals process takes longer than Kevin Na’s pre-shot routine.
The facts of the case are light but here is what we know so far. Rory was unhappy with the advice he was receiving from his then manager Andrew “Chubby” Chander in 2011. Rory, needing to make a change, reached out to Horizon Sports Management for new representation, since his good friend Graeme McDowell was also represented by them. According to the allegations stated by Rory’s team, Horizon’s founder Conor Ridge apparently told Rory that his deal with Horizon would be the same as their deal with McDowell. Rory signed with Horizon in December of 2011 when he was 22 years old. Horizon and Rory entered into another deal two years later right around the time he signed a $100+ million deal with Nike. Horizon is undoubtedly entitled to a piece of that.
Apparently in 2013, Rory somehow learned that his Horizon deal was not the same as McDowell’s and that Rory had paid Horizon close to $7 million more in fees than what McDowell’s contract required. Rory then split with Horizon and almost immediately started his own company, Rory McIlory Inc., before filing this lawsuit.
The purpose of this court battle is to get Rory out of the remainder of his two contracts, claiming that because he was 22, “inexperienced” and did not consult his own lawyer, the contracts with “markedly inferior terms” should be void due to Horizon’s undue influence over Rory.
According to the Irish Times, Horizon’s legal team stated that Rory’s claims are baseless and that Rory was never told that he would get “the same deal” as McDowell. Horizon is countersuing Rory for millions in unpaid fees for off-course endorsements, as well as damages for the continued breach of the two contracts.
Lets take a look at both side’s argument based on what we know. Keep in mind that I have not been able to read the complaints filed in the Dublin court.
Rory’s attempt to get out of his contract with Horizon is based on the legal doctrine of undue influence in contract law. Unfortunately, there is no statutory basis giving us a clear-cut definition of what amounts to undue influence. Also, Rory’s case was filed in a Dublin court, which may have a slightly different process than a U.S. court. However, Ireland follows many of the same legal doctrines as the U.S. and their contract laws appear to be pretty similar.
Undue influence basically states that a contract is voidable because one party took advantage of another party in order to convince that party to sign an unfair contract. Unlike certain circumstances where a contract is automatically deemed void regardless if brought to court (i.e. one party is under the age of 18), a voidable contract means that a contract CAN BE deemed void only where the circumstances require.
There are two types of undue influence. Actual undue influence, or duress, where an agreement is made only after one party actually uses some sort of influence over the other party to make he/she agree against their will. This is typically done by force or threat of force or some type of bullying like badgering the person to sign. It’s pretty unlikely that Rory could be taunted or threatened into signing, and there are no facts leaning to anything of the sort so far, so we can probably rule that out.
The second type is the strongest argument Rory can make because it puts almost all of the burden of proof on the defense. Wrongdoing is assumed based on the relationship between the parties. These relationships are those where one party is in a position of power and is being trusted to act in the other’s best interest, i.e.: parent/child, doctor/patient, attorney/client.
Rory will most likely argued that he believed that Horizon would be representing him the same way they are representing McDowell and because he was only 22 and did not think to get himself a lawyer because he was “inexperienced,” and that Horizon knew that Rory was trusting Horizon to act in his best interest.
The court will first look to see if the relationship creates the presumption that undue influence occurred. It is hard to determine if a judge is likely to find this. Those relationships typically involve a pre-existing relationship where trust has already been established through a long-time, working relationship. Rory never worked with Horizon before, thus had no history of a trusting relationship to point to. This may lead the court against the presumption, and Rory will be required to show evidence that Horizon acted in bad faith.
If the court does find that such relationship existed, however, Rory’s job is done and it will be presumed that Horizon did use their position over Rory to get him to sign a much more expensive contract. The burden of proof will switch to Horizon to rebut the presumption and show that that it did not use any position over Rory to make him agree to something without his knowledge. Horizon will most likely argue that that it did not pressure him to sign anything, did not lie or mislead him about the terms of the contract and did not prevent Rory from allowing a lawyer to review the terms of the contract. This can be difficult to show, especially if correspondences between the Horizon and Rory were deleted.
It will essentially be a he said/they said — which will most likely cause issues in determining the credibility of witnesses and cause a judge/jury confusion in making a decision.
Regardless of the law and how a Dublin court decides, a few things do not sit well. Unless more facts come out that show behavior in bad faith by Horizon, Rory is basically saying that he shouldn’t have to pay his management company, who helped him land Nike, because he thought he was only going to have to pay what McDowell was going to have to pay. And he should not have to pay Horizon only because he thought Ridge told him he would get the same contract as McDowell, but did not exercise any type of due diligence to assure that it would be reflected in the contract because he was an inexperienced 22-year-old.
My opinion would change, of course, if facts surface that Rory was actually shown a copy of McDowell’s contract and promised the same thing, if McDowell (a Horizon shareholder) personally played any part in getting Rory to agree to a different arrangement, or if Horizon did deplorable things to try to take advantage of an inexperienced kid. The truth remains to be seen, but with the facts available today it looks as though Rory didn’t do his homework.
This past Monday, I played in the U.S. Amateur local qualifier at Rock Creek Country Club in Portland, Oregon. A full tee sheet from 7:30 a.m. to 1:55 p.m., the top 11 scores would make it to the U.S. Amateur final qualifying.
I teed off at 10:48 a.m.. With the 7:30 am tee time, you can get a feel for the leaders’ pace, and they were off and running on the challenging setup at Rock Creek.
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Getting to the highlight of the round on the par five 17th, a drive up the left side and 212 yards left to the front hole location. I took out a 5-iron with plans of middle of the green. The ball ended up 8 feet left of the hole, pin high. A slight downhill putt dropped in for an eagle 3 on the 17th. With the cut line looking to be anywhere from -2 to even par. This was the boost I had been waiting for all day.
With making par from the trees on 18, it was time to wait for a potential playoff with a posted score of one under par 71.
Three hours later, it was playoff time. 8 players for 6 spots. I made par on the playoff hole, which was good enough to advance to the U.S. Amateur final qualifying in July. USGA qualifiers sure deliver on all of the emotions in golf!
Club Junkie
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marcel
Dec 16, 2014 at 12:25 am
Horizon has any money coming from other sources apart of milking Rory since GMac is shareholder. pity they leach on young guy.
Rod
Dec 13, 2014 at 6:28 pm
It goes to show that Horizon are all about the $ and you would hope that if they wanted to stay in the golf industry, they would want this to get sorted sooner rather than later.
They might get their pay day from Rory, but I think they will damage their reputation. You should be able to have an honest relationship with your management team.
It was interesting to see how Oakley were very verbal about getting compensation from Rory due to him ending the contract but they seemed to calm down. Perhaps they have more to loose re product sales.
If Horizon just quote the small print, it bypasses what they are all about which is managing relationships.
I hope Rory can get it sorted out and it’s only money. Rory needs to keep focused on his main skill which is winning golf tournaments and perhaps delegate all the commercial and legal issue to someone he can trust.
Regis
Dec 12, 2014 at 7:45 pm
My guess is this is a case in Equity. Kind of like an annulment. Rory is basically asking the court to declare the contract void ab initio, meaning asking the court to declare the contract never was entered into because of the “over reaching”. Tough sell. As to the phones. Keep in mind that Rory bolted Horizon for a management group that he formed with friends and family. Those phones could contain records of non-horizon people, like his dad pertaining to setting up the new group. When did he start the concept of forming his own group and with whom? What were the conversations? Goes to his argument that he was unsophisticated. Finally there is a principle in most US courts called spoliation. Means if you delete or destroy records, the trier of fact may consider it a presumption that those deleted records were detrimental to your position
Steve
Dec 12, 2014 at 4:33 pm
Is Rory serious? I was 22 and didn’t know any better, really. 22 old enough to vote, old enough to drink, old enough to die in war, but to dumb to know. Arrogance is no excuse, this why there are contracts. If they pulled the wool over his eyes that is to bad on him for signing. It is common place in the music industry to screw over young talent on the first contract. Talk to Springsteen, billy Joel, or any young and dumb musician that signed on the hood of a car. He is going to have eat it and buy himself out of the contract. Write it off to being stupid
luke
Dec 12, 2014 at 8:31 pm
too* calling someone stupid and using incorrect grammar
Knobbywood
Dec 14, 2014 at 5:12 am
Incorrect sir
bradford
Dec 15, 2014 at 7:14 am
“too* calling someone stupid and using incorrect grammar”
…um wut?
Justin
Dec 12, 2014 at 2:00 pm
Any legal binding document would have been an sent via email and probably still have been available if the phone was wiped. I would bet my next check that Rory wipes his phones like we all do when we get rid of them for a number of reasons, delete personal info, phone numbers, texts, most importantly inappropriate Pictures and Video’s since celebrities and athletes tend to end up on the web nude lately. He is 22yrs old, Rich, Famous and dates models I can only imagine the digital media on his phones and how much people would pay to get it. The question of how many phones he had is irrelevant, if you have that type of money it would be easier to have the provider send you a new phone & # then cancel the old one. Can you see Rory in the parking lot at Augusta talking to AT&T trying to change his number, me either…
tom
Dec 11, 2014 at 1:57 pm
Can’t see the “only 22 and did not think to get himself a lawyer because he was inexperienced” stance holding up. He was still an adult. He should have known better.
Ben
Dec 12, 2014 at 9:56 am
Totally agree. Sounds like a costly mistake… Learn from it and move on.
golfing
Dec 11, 2014 at 12:59 pm
Horizon means it will suck you till you can see!
This company already did destroy 2 years of the kid majors years.
What a bunch of money sucking people.
From the signing of the contract at a party, to the Oakley and Nike mess
and so on, this is not a player needs in is head, good job destroying
a star!
Mat
Dec 11, 2014 at 12:04 pm
Just out of curiosity… can’t he argue that a verbal agreement of equity is as enforceable as the construct of the later written contract? I think this misses the point; you have “undue influence” if you were lied to, correct?
If someone says, “you’re getting the same deal”, and then you find out it’s not at all the same deal, can’t you then argue that the subsequent signed contract was in fact misleading? One party was “in power”, and it was the one who knew both Rory’s and Graeme’s contract terms. That “power” led them to make a deal that they knew was inequitable.
Dressing this stuff up through “he was young” or “inexperienced” doesn’t mean that the same conclusion would have come about. They could have held said “power” even if RoryCo had retained counsel. In the end, it’ll be interesting to see how this comes out. But if the narratives have a modicum of truth in that the verbal deal was “the same terms”, and the paper says otherwise, I think RoryCo will end up prevailing. The verbal contract from the agent/agency is going to be enforceable unless something else comes up.
Thomas
Dec 11, 2014 at 1:31 pm
Disclaimer: this is not legal advice. It will depend on what the law in their jurisdiction says. Here in the US, though, a court will typically look first to the written contract. Contracts often have clauses that say any negotiations or representations leading up this contract are not admissible. In other words, if a term did not make it into the writing, it is neither admissible nor enforceable. That rule is in place to prevent exactly this situation: “they told me something different than what I actually signed.” If that rule does not exist, contracts are not worth the paper they are written on. Everyone could simply make that type of claim to get out of every contract they disliked. (So it is his burden to make sure every term is in there BEFORE he signs.) As far as undue influence, lying does not really enter that picture. (Lying plays more of a role in defrauding someone to enter into a contract, which is a different issue.) Undue influence, by contrast, looks more into the relationship between the parties: in other words, was the person signing of limited capacity to understand, and then the other side “unduly” exerted its position of trust or authority over the other to get them to sign. This to me seems to be the least likely to win: here, it was two knowledgeable business entities (or adults) negotiating or entering into a contract. They appear to have been on equal footing, and would be treated that way.
real talk
Dec 11, 2014 at 11:35 am
So much hate for Rory on here. I’m willing to bet that all the vitriol comes from Tiger fans who can’t stand the fact that Rory absolutely owns Tiger and has been humiliating on the course for years.
scott
Dec 11, 2014 at 1:07 pm
last time I checked tiger had 14 and rory had 4 I wouldn’t say that 4 is beating 14 and that rory might still have some work to do in order to catch tiger
Barack
Dec 11, 2014 at 3:59 pm
After Rory won a bunch in 2012, Tiger won 5 times in 2013. He’s hardly humiliated the guy. Rory couldn’t win 5 this year, so until Rory wins a a faster clip than 3 year old Tiger, I’m not buying it.
I know, I know Tiger didn’t win a major. He won the Players though. That’s a tough win. Let’s just agree that both men healthy is good for golf.
And these sharks who got rich off Rorys back, give em hell kid. If it feels wrong to you, fight em bruh.
Am I the only golf fan that likes Tiger and Rory?
Teaj
Dec 12, 2014 at 10:02 am
Nope I to am a Tiger and Rory fan because I am a fan of golf, the other stuff I can care less about. People like to make assumptions on both, like Tiger does not relate to fans because he does not share much in interviews and then when Rory shares to much they flog him too. Both are just humans and have a different way of expressing their views but non of this has anything to do with the way they can dominate the game of golf. I hope both can be healthy at the same time and at the top of their game so we don’t have to guess who would beat who like when Tiger was coming up and people pondered the question who would win Jack or Tiger.
Daniel
Dec 11, 2014 at 8:24 am
The guilty party is always the one who runs, or hides things, or in this case wipes their phones clean. And wouldn’t Horizon have all of their communications with Rory saved anyway. Why do they need what’s on the phones. If it’s Rory taking to Nike behind their back, the court can just get all that from Nike right?
I agree with everyone else on here, just pay the money and move on. Instead of Rory having enough money for 100 lifetimes, he’ll now only have enough for 90.
Jack
Dec 15, 2014 at 3:36 am
Why would he talk to Nike when they have and are paid to do the work for him? I don’t agree with what he’s claiming, since he should have had a lawyer present, unless he can prove that Horizon persuaded him to not have one in order to have him sign a contract that he did not intend to sign out of total trust.
I wonder if he’s still friends with McDowell.
Pat
Dec 11, 2014 at 8:23 am
Mo money, mo problems. Seriously though, filthy rich people are driver by one thing and that’s greed. Rory is no different. I do agree with you however. He should settle this out of court and move on. I don’t see how he’s going to win his suit based on the stories and the premise on which he is defending his position. Nobody put a gun to his head and forced him to sign the contract. He did it willingly. He needs to man up and take care of his issues or else it will affect his game negatively for the the 2015 season.
Slimeone
Dec 11, 2014 at 7:51 am
Why did he have eight iPhones?
Marshall Brown
Dec 11, 2014 at 11:25 am
Media kept getting his number, so he had to change phoned constantly.
Rich
Dec 11, 2014 at 5:15 pm
Doesn’t mean he needed a new phone each time. He’d just switch the number if that was the reason
Marshall Brown
Dec 11, 2014 at 6:45 pm
You are right, I didn’t think about that. I just read that somewhere yesterday and assumed it was the reason.
Bobsyouruncle
Dec 11, 2014 at 1:19 am
No matter the outcome, this has to hurt Horizon’s reputation and bottom line. What other athlete and especially a hot upcoming talent is going to want to sign a contract with them now?
In the meantime, all the lawyers on both sides are getting paid handsomely for battling this out in the courts. Life is good for someone.
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sam
Dec 10, 2014 at 9:56 pm
i don’t think this will effect him mental much at all.
its just money he can cover it..
real talk
Dec 11, 2014 at 12:06 pm
Take this for what it’s worth…
One of my best friend’s dad is very well connected in the golf world and a close friend with Rory. He thinks the world of Rory BTW. Rory doesn’t care about the money. This is all about respect and principle for him. Rory treats everyone with class but when you cross him he will unleash h***.
Fsubaseball21
Dec 10, 2014 at 9:38 pm
I’m sure Rory has been told numerous times that this mess should have been settled long before papers were filed. When you open yourself up to discovery you had better be sure all of your bases are covered. Just my opinion but Horizon wins this case easily. Shame on both of them for not getting into a room and working something out like normal human beings. Horizon was shady but at the end of the day 22 years old makes you an adult.
golfpros1
Dec 10, 2014 at 9:14 pm
He dropped his guard because he was use to dealing with Chubby, a person that is unique in this business by not messing over his clients and believing a handshake means as much as a contract. Rory made a mistake leaving chubby and this is what he got for his decision.
Stan
Dec 10, 2014 at 8:01 pm
Couldn’t have picked a better picture of Rory for this article. Mr. Shifty Eyes.
mark m
Dec 10, 2014 at 7:16 pm
Its a difficult case for Rory to make and its would set a bad precedent. So would every 22 year old that applies for a credit card, loan, mortgage, etc and enters in to a legal financial arrangement argue that they were too stupid to read what they were signing and therefore the contract is void? I think not.
This and Rory is hard pressed to prove that he was harmed by this deal seeing as they landed him Nike and at the end of the day if he pays what he owes he won’t exactly be broke, only slightly less rich.
dave
Dec 10, 2014 at 7:15 pm
why doesnt he take some of the $200+ M from Nike and call it a day? im sure Nike can’t be happy about the timing of all of this. Cut a check and move on! (easier said than done iknow) but why fight this hard !!
Law
Dec 10, 2014 at 6:20 pm
Good bye Rory. It was nice seeing you at the top of the game for a while.
David
Dec 11, 2014 at 4:08 am
Oh God…the morons are out.
Joke
Dec 13, 2014 at 4:11 pm
God can’t take a joke
Donnie
Dec 10, 2014 at 6:18 pm
First, how could he have not consulted with a contract attorney, given what (even a stupid 22 year-old would have to known was millions of dollars) was at stake. He needs to “fire” his dad. Here’s a 100k a month allowance pop, I love you!… Second, if Graeme really is a “shareholder” in the company and he was promised “the same deal as Graeme” then he probably does have some legal ground to stand on, albeit shaky. A smart guy would say, “how many shares does Graeme own?” Oh really? I want three times that number, and boy what a good deal you are getting… If the relationship were successful how many other golfers would he have attracted to this management company??
Dear Rory, I would like to introduce you to a term called a “flat fee” when you have 100’s of millions coming your way, you should get familiar with the concept.
luke keefner
Dec 10, 2014 at 5:27 pm
Make a deal, settle out of court,slap each other on the back, shake hands and move on. Its not like any of these people need the money…
Mike honcho
Dec 10, 2014 at 4:52 pm
He probably wiped it to get rid of the pics of Caroline
Golfraven
Dec 10, 2014 at 4:44 pm
Of course he was paying more because he was earning far more the GMAC that time. Still a rip off from this management group and hope they loose the case. the claim with the iphone devices is a joke.
Rich
Dec 11, 2014 at 12:12 am
Ok, based on what? How do you know it’s a joke?
Golfraven
Dec 12, 2014 at 3:04 pm
Fair question. I think that his personal devices don’t hold an evidence for this particular case. Doubt his contractual conversation went over whatsapp. Nobodies business what he has stored on his iphone. The facts are clear in this case, he signed an agreement which he later didn’t agree with and he is free to cancel it with some additional fees – as for any contact in real life. Although I agree he was rather naive not get legal advise.